Pittsburg: Proposed WesPac oil-by-rail shipping terminal is dead
By Sam Richards, 12/09/2015 06:37:16 AM PST
PITTSBURG — Plans to convert a moribund PG&E tank farm into a regional oil storage facility appear dead after the company proposing the project backed out, according to a city report.
WesPac Midstream LLC’s proposed Pittsburg Terminal Project had been in development on and off for the past four years.
WesPac on Nov. 16 “submitted a formal request to withdraw their application completely and terminate all work on the project,” according to the city report released Tuesday afternoon. No explanation was given for the Houston-based company’s decision.
In a voice mail, City Manager Joe Sbranti said Tuesday, “They didn’t give us a reason; they just withdrew it.”
Art Diefenbach, WesPac’s Pittsburg project manager, could not be reached for comment Tuesday evening.
In April, WesPac eliminated a proposed element of its project, withdrawing plans for loading as many as five 104-car oil trainloads a week at the Pittsburg facility. Diefenbach said at the time that the “regulatory environment” surrounding rail shipments of crude oil made it impractical to launch such trains.
The city report made no mention of oil prices, or whether they had an effect on WesPac’s decision. But at $37.51 a barrel Tuesday, prices are at their lowest since February 2009, down from almost $108 a barrel on June 14. The low oil prices have rocked the stock markets in recent days.
He also said then that protests against the crude oil trains, locally and nationally, factored in to the decision to abandon the rail proposal.
The old tanks are less than a half-mile from hundreds of houses and apartments on West 10th Street and in the downtown area between Eighth Street and the waterfront.
The project drew staunch opposition from various area environmentalists, as well as the Pittsburg Defense Council group. Reasons for opposition were myriad, critics said, ranging from the threat of an explosion at the terminal to prospective ground pollution issues to the vapors from the storage tanks.
Kalli Graham said the local group Pittsburg Defense Council, to which she belongs, had been fighting the oil terminal proposal since its inception, collecting more than 5,000 signatures against it in the process and even getting state Attorney General Kamala Harris to weigh in against it.
“WesPac had a big fight on its hands; there is pretty much no one in Pittsburg that wanted this,” said Graham, whose group was spreading the news among its followers Tuesday afternoon. “We don’t have to be worried about it anymore.”
City Council members Pete Longmire and Will Casey said Tuesday the council never received enough details about the project to make informed decisions on the worth of the project; even after four years of start-and-stop proposals, it was still early in the planning process.
“I was neutral on the project,” Longmire said. “I know this (WesPac) decision will make a lot of people in our city happy. But there are people in our city who wanted it to come, with the jobs it would have provided.
Repost from The Contra Costa Times [Editor: Significant quote: “WesPac officials said they dropped inbound crude oil shipments by rail from their plans for several reasons, including public sentiment against it, an unstable regulatory environment surrounding those shipments, and drops in crude oil prices that have made such shipments less economically viable.” – RS]
Pittsburg: Critics blast proposed oil terminal, even without Bakken crude trains
By Sam Richards, 04/07/2015 12:31:04 PM PDT
PITTSBURG — Train loads of Bakken crude oil are no longer in the plans for a proposed oil storage terminal near the waterfront, but that does not mean the project is being welcomed to town with open arms.
The City Council voted 5-0 Monday night to approve amending the environmental report for WesPac Midstream LLC’s proposed Pittsburg Terminal Project, which would renovate and modernize a long-dormant PG&E tank farm between West 10th Street and the Sacramento River waterfront.
The key change is that the five previously planned 104-car trains of domestic oil, mostly the volatile Bakken crude, are no longer part of the project. The new EIR will reflect that.
Councilman Sal Evola stressed that the vote reflected the council’s desire for “the process” to play out and fully vet the proposal.
“Every project at least deserves its fair process,” Evola said. “I’m all for preserving our industrial base, but we have to do it safely, and fair process is needed.”
Others were less interested in process, saying the WesPac proposal to bring an average of 242,000 barrels of crude or partially refined crude oil to be unloaded daily from ships and from pipelines, and stored in 16 tanks on 125 acres, is a problem for various reasons.
Speakers told the council that vapors from the storage tanks, the possibility of spills into the Sacramento Delta and the danger of the tanks exploding — all near hundreds of downtown homes — are potential issues, and that the project should simply be rejected.
“The only way you can mitigate this project is not do it,” said Willie Mims, representing the NAACP and the Black Political Association.
And though some at the meeting Monday night are grateful that WesPac that no longer plans to bring crude oil to the terminal by rail, others told the council that leaving out rail shipments doesn’t come close to salvaging the project. Some 30 people holding up “No WesPac” signs or wearing similar T-shirts crowded the council meeting.
Without the trains, the Pittsburg Terminal Project would now take oil from ships and a pipeline from the Central Valley and store it for later processing by refineries in Martinez, Benicia, Rodeo and Richmond.
Pamela Aranz of Antioch, representing the group Global Community Monitor, was one of several speakers who criticized the WesPac proposal as a dinosaur — old-fashioned, with increasingly outmoded technology. Others said the oil terminal would be at cross purposes with a nicely developing downtown area. Developing wind and/or solar power on that land, Aranz and others said, would make better sense.
Plans for the Pittsburg Terminal Project, first proposed in 2011, had been dormant for the past year, after local groups like Pittsburg Defense Council had protested the prospect of trains carrying volatile Bakken crude oil rolling in to the city. Communities across the United States — including Pittsburg, Richmond and Berkeley — have come out in opposed to crude by rail shipments through their cities after several high-profile derailments, including one in Lac Mégantic, Quebec, in 2013 killed 47 people and destroyed part of that city.
The new environmental report, to be paid for by WesPac, will replace an earlier one that was criticized in 2014 by the state Attorney General’s office because it did not suitably analyze air pollution impacts, address the risks of accidents involving storing and moving oil, consider the project’s climate change impacts, and consider a “reasonable range of alternatives” that could reduce impacts. WesPac officials said they dropped inbound crude oil shipments by rail from their plans for several reasons, including public sentiment against it, an unstable regulatory environment surrounding those shipments, and drops in crude oil prices that have made such shipments less economically viable.
If the needed approvals come at a typical pace, renovation work at the old PG&E tanks could begin in early 2016, and likely would take between 18 and 24 months.
Representatives from several area labor union locals supported moving ahead with the environmental study. Some said Monday night they wanted the jobs, both to rebuild the terminal and to operate it. Others said they favored the environmental process determining whether the terminal would be a safe place for union workers to be.
That, Evola said, is one benefit of continuing the process. “We want to be overly transparent,” he said.
That is fine with Lisa Graham and other members of Pittsburg Defense Council.
“We’ll be shining a bright spotlight on the project in the coming months,” she said.
Across the continent, Big Oil was also dealt two blows against its attempts to import extreme crudes into California by rail. In the face of strong community opposition, midstream oil company WesPac has abandoned its plan to build a rail terminal that would have brought dirty crude oil into the San Francisco Bay Area.
A few years ago, WesPac proposed a rail and marine terminal that would transport 242,000 barrels per day of crude oil–nearly a third of the capacity of Keystone XL–through Pittsburg, CA, a small community of 60,000 residents and then on to Bay Area refineries. The problems with WesPac’s proposal are myriad: it would expose Pittsburg’s population, largely communities of color and low-income communities, to the risks of exploding trains and increased air pollution, and it would require a massive investment in fossil fuel infrastructure at a time when we should be moving toward clean energy solutions.
The project was so ill-conceived that, following comments by NRDC and others, the California Attorney General wrote a letter finding “significant legal problems” with the project’s environmental review documents. Accordingly, the city decided to put the project on hold and revisit its environmental review process. That’s where things stood for over a year, until last week, when WesPac announced that it would drop the rail terminal aspect of the project altogether.
As community and environmental advocates have repeatedly pointed out, oil trains pose serious risks–risks that were highlighted by a series of fiery accidents over the last few weeks. (Notably, some recent accidents have involved Canadian tar sands crude, in addition to a bevy of dangerous mishaps involving North Dakota’s Bakken crude, which has long been known to be highly volatile and has been the culprit in most oil train disasters.)
These victories show the power of local communities to stop Big Oil in its tracks.
The battle, however, is far from over: Valero is still trying to push forward with its rail terminal, and WesPac’s proposed marine terminal would have significant impacts on the fragile San Francisco Bay Delta and nearby residents. In fact, WesPac’s plans may still include the renovation of long-dormant storage tanks to stockpile large volumes of volatile crude oil, even though those tanks are literally a stone’s throw from homes, churches, and a school.
Some critics have used the boom in crude oil trains as evidence that we should allow more pipelines. They offer the false choice of risk from pipelines or risk from oil trains. The truth is more sinister. Big Oil wants more of both. Pipelines and rail serve different geographic areas and often carry different types of oil. The problem is that both forms of transportation have risks, and both bring fossil fuels perilously close to our communities. Clean energy investments do the opposite: they eliminate the dangerous risks of spills and bomb trains, while cutting carbon pollution.
It’s time our elected leaders follow the example of communities across the country by saying “no” to Big Oil and “yes” to clean solutions that accelerate fuel efficiency, electric vehicles, clean fuels, and renewable energy such as solar and wind.
Franz A. Matzner is associate director of government affairs for the Natural Resources Defense Council. His policy background includes energy, climate, and forestry. He previously held the position of senior policy analyst for agriculture and the environment at Taxpayers for Common Sense (TCS). Matzner graduated Phi Beta Kappa from the University of Pennsylvania. He is co-author of the NRDC report “Safe At Home: Making the Federal Fire Safety Budget Work for Communities.”
Christopher McKenzie, the LCC’s executive director, already has sent a letter March 6 on behalf of its board of directors to U.S. Secretary of Transportation Anthony R. Foxx, asking that his department make LCC’s recommendations part of federal policy in governing rail safety.
“The continued increase in the transport of crude oil by rail, combined with recent rail rail accidents involving oil spills and resulting fires, have served to heighten concerns about rail safety among many of our member cities,” McKenzie wrote.
Rail safety, particularly in transport of crude oil from North Dakota’s Bakken fields, has become a growing concern nationwide and elsewhere.
The California Environmental Protection Agency has been presenting a series of forums on the matter, one of which took place March 26 in Crockett, a meeting attended by several Benicia residents who oppose delivery of oil by train.
In another development this week, WesPac Midstream has dropped the crude-by-rail component of its intent to transform a Pacific Gas and Electric tank farm into a regional oil storage site.
In explaining the move Project Manager Art Diefenbach cited uncertainties about prospective changes in regulations of oil shipping by rail, a series of protests and falling crude prices that have made shipping by train less attractive. Should the project be completed, oil would arrive either by ship or pipeline, which Pittsburg Mayor Pete Longmire suggested would make the operation safer and less controversial.
In his letter, McKenzie cited incidents that prompted the LCC to express its own safety concerns and to offer recommendations that might reduce the potential for accidents.
“Specifically, two derailments accompanied by fires involving unit trains (100 or more tank cars) carrying crude oil in West Virginia and in Ontario, Canada, earlier this month have greatly increased public anxiety about what steps the relevant federal regulatory agencies are taking to improve rail safety and on what timetable,” he wrote.
He said the LCC wanted to make three points: First, that improvements that are required of participating industries should be mandates, not recommendations; second, that the mandates should have a hard deadline for implementation; and third, that the Department of Transportation should include the LCC’s recommendations in the final rule for Safe Transportation of Crude Oil and Flammable Materials.
McKenzie wrote that the LCC wants all federal agencies involved in regulating crude-by-rail shipments to require electronically controlled braking systems on trains carrying the sweeter crude from the North Dakota Bakken oil fields, and to set a sooner date for phasing out or retrofitting the older DOT-111 tanks.
More federal money should be directed toward training and equipment for first responders who are sent to hazardous materials accidents, he wrote, and how the funding is to be distributed needs to be defined. In addition, trains should have maximum speed limits in all areas.
His letter said the LCC wants the number of tank cars that trigger a California Energy Commission and State Emergency Response Commission report lowered to 20 from 33, which in turn would lower the trigger point from shipments of 1.1 million gallons or more to those of 690,000 gallons or more.
Priority routes for positive train control, a technology that incorporates geopositioning tracking to slow or halt trains automatically to reduce collisions, should be identified, McKenzie wrote, and parking and storage of tank cards need regulating, too.
He further wrote that railroads should be forced to comply with their Individual Voluntary Agreements with the US-DOT, because currently there is no requirement for them to do so. Those pacts involve reducing speed limits for oil trains that use older tank cars and travel through urban areas; determining the safest rail route; increased track inspection; adding enhanced braking systems; improving emergency response plans and training; increasing track inspections; and working with cities and communities to address their concerns about oil transport by train.
“The League of California Cities understands that this area of regulation is largely preempted by federal law,” McKenzie wrote. “That is why we are urging specific and timely action by the federal agencies charged with regulatory oversight in this area. We do not expect that derailments and accidents will cease altogether, but we anticipate that stricter safety standards will reduce their numbers over time.”
The LCC also has supplied member cities with a sample letter patterned after McKenzie’s message, to customize before sending to Foxx.
In a report to Benicia City Council, City Manager Brad Kilger wrote, “The League Executive Director has requested that cities send letters to the appropriate federal rail safety rulemaking authority requesting that these measures be implemented.”
Since the preparation of the letter template, he wrote, the LCC has learned that any decisions on improved safety regulations would be made in the Office of Management and Budget.
“The mayor is requesting that the city send a letter on behalf of the Benicia City Council,” Kilger wrote.
Consideration of the letter won’t conflict with future consideration of a request by Valero Benicia Refinery to extend Union Pacific Railroad tracks onto its property and make other modifications so it can substitute rail delivery for tanker ship delivery of crude oil, a highly contentious proposition that is currently undergoing environmental review.
“In that the city is currently processing the use permit and EIR (environmental Impact Report) for the Valero Crude-by-Rail Project, I asked the city attorney to determine whether sending a letter requesting rail safety improvements would in any way create a due process issue for the city,” Kilger wrote.
He said City Attorney Heather McLaughlin informed him there would be no conflict because the letter doesn’t take any position on the Valero project or the adequacy of the ongoing environmental review.
“The letter simply urges the adoption of more stringent federal standards for the transportation of crude by rail,” Kilger wrote.
If the Council agrees the letter should be sent to Foxx, it would be signed by Patterson as mayor, and copies would be sent to California’s two U.S. senators, Dianne Feinstein and Barbara Boxer, all members of California’s delegation in the U.S. House of Representatives, the Federal Railroad Administration, the National Transportation Safety Board, the Solano County Board of Supervisors, the Solano Transportation Authority, Kilger, McLaughlin and members of the Council.
The Council will meet at 7 p.m. Tuesday in the Council Chamber of City Hall, 250 East L St.